Public Policy

Road Work: Michigan Chambers Help with Transportation Funding

Hannah Nequist on Tuesday, November 24, 2015 at 4:00:00 pm

After a long and hard fight in the legislature and at the ballot box, Michigan finally has a long-term plan for road funding.

Transportation funding has been a top priority for several years, but the final solution wasn’t found until after voters in May struck down a measure that would have increased the state sales tax by 1% to help raise $1.2 billion for transportation. In the worst defeat for a Michigan ballot measure in 52 years, 80% of voters said no. While it was clear that this particular plan was not what voters wanted, the public and the business community were still clamoring for a solution to solve a looming transportation crisis.

According to a study released in the spring, 38% of Michigan’s major roads are in poor condition, 45% are fair, and only 17% are good. Under current funding, the Michigan Transportation Asset Management Council estimates that 53% of those major roads will be in poor condition by 2025. With the “Pure Michigan” campaign spending money to draw travelers to Michigan, and countless other industries relying on surface transportation, it was clear that funding infrastructure improvements was overdue.

Transportation has long been a major priority for the Grand Rapids Area Chamber of Commerce. A 2015 member survey found that transportation was a top concern, with 64% saying that poor road conditions had an impact on their business. So, when a balanced package was being considered in the legislature to raise the $1.2 billion with a combination of new revenue and existing state dollars, the chamber moved to support the measure.

Grand Rapids joined five other regional chambers in support of a common sense, long-term funding solution calling for $600 million in dedicated funding from existing state revenues, and $600 million in new money. The other five chambers were The Chamber of Commerce – Grand Haven, Spring Lake, Ferrysburg, the Michigan West Coast Chamber of Commerce, the Muskegon Lakeshore Chamber of Commerce, the Lansing Regional Chamber of Commerce, and the Traverse City Area Chamber of Commerce.

According to Josh Lunger, director of Government Affairs in Grand Rapids, “the unified show of support was helpful in advancing the plan.” On Nov. 4, the Michigan Legislature passed the compromise package which was signed a week later by Gov. Rick Snyder. The $600 million in new revenue will come from $400 million from increasing the gas tax 7.3 cents per gallon and creating diesel parity, and $200 million from a 20% increase in registration fees.

The revenue increases take effect in January 2017. Moving forward, Lunger stressed the importance of working hand in hand with legislators to effectively plan for future budget pressures and the shift of $600 million in “existing state dollars". He urges deliberate and thoughtful consideration to determine where best to make changes so that important programs, such as Early Childhood Education and Workforce Development, are not compromised.